Critical mineral processing gets Rs 2,814 cr boost, Pg15

Key Highlights:

• The Union Cabinet approved a new scheme with an outlay of Rs 2,814 crore to develop domestic critical mineral processing capacity.
• The scheme provides a 30% capital subsidy for establishing four processing plants: two for lithium (30 kt each) and two for nickel (50 kt each).
• Maximum capital support is capped at Rs 500 crore per lithium beneficiary and Rs 900 crore per nickel beneficiary.
• This initiative aims to bolster India’s critical mineral value chain, benefiting sectors such as electric mobility and battery energy storage systems.

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Detailed Insights:

• The scheme addresses India's near 100% import dependence for key critical minerals like cobalt, lithium, nickel, and rare earth elements.
• It seeks to mitigate strategic vulnerability due to China's 90% dominance in global critical mineral processing.
• Four states have been identified for promoting processing plants: Gujarat and Andhra Pradesh for rare earth processing, Odisha for nickel, and Maharashtra for lithium.
• Odisha is chosen for nickel processing due to its domestic reserves and strategic location for imports from countries like Indonesia.
• Gujarat is selected for rare earth processing given its existing heavy rare earth elements and beneficiation capabilities.
• The government is also formulating a new policy for stockpiling critical minerals to create a buffer against potential supply disruptions.
• The National Minerals Mission (NMM) proposes a Critical Mineral Strategic Programme for stockpiling and strategic mine development.

Key Concepts Involved:

• Critical Minerals: Minerals essential for modern technologies and economies, facing high supply risk due to geological scarcity or geopolitical factors.
• Capital Expenditure (Capex) Support: Financial assistance provided by the government to businesses for acquiring or upgrading physical assets like processing plants.
• Rare Earth Elements (REEs): A group of 17 chemically similar metallic elements vital for high-tech applications, including electronics, defence, and renewable energy.